NY State Senate Bill S1195

Archive: Last Bill Status - In Senate Committee Budget And Revenue Committee

Introduced
In Committee
On Floor Calendar
- Passed Senate
- Passed Assembly
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Actions

view actions (2)

	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jan 05, 2022	referred to budget and revenue
Jan 08, 2021	referred to budget and revenue

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S1195 (ACTIVE) - Details

See Assembly Version of this Bill:: A5701
Current Committee:: Senate Budget And Revenue
Law Section:: Tax Law
Laws Affected:: Amd §208, Tax L; amd §11-652, NYC Ad Cd
Versions Introduced in Other Legislative Sessions:: 2019-2020: S3401, A10443
2023-2024: A1727

S1195 (ACTIVE) - Summary

Relates to investment income and capital gains on investments deferred or excluded under 26 U.S.C. section 1400-z-2.

S1195 (ACTIVE) - Sponsor Memo

 
BILL NUMBER: S1195

SPONSOR: GIANARIS
 
TITLE OF BILL:

An act to amend the tax law and the administrative code of the city of
New York, in relation to investment income

 
PURPOSE:

 
SUMMARY OF PROVISIONS:

Section 1 is the title of the act.

Section 2 amends paragraph (a) of subdivision 6 of section 208 of the
tax law to include capital gains on investments deferred or excluded
under 26 U.S.C. Section 1400z-2

Section 3 amends paragraph (a) of subdivision 5 of section 11-652 of the
administrative code of the city of New York to include capital gains on
investments deferred or excluded under 26 U.S.C. Section 1400z-2

Section 4 sets the effective date.

 
EXISTING LAW:

 
JUSTIFICATION:

The federal tax overhaul passed in 2017 included a provision aimed at
incentivizing investment in economically distressed areas. These areas,
"qualified opportunity zones" were designated by states in 2018. Inves-
tors who create opportunity funds to invest in these census tracts are
able to defer large capital gains on their federal taxes.

Though a laudable goal, the vague standards for states to designate
opportunity zones has allowed Empire State Development to designate many
areas with booming, over-developed real estate markets as opportunity
zones. These include New York City census tracts in Long Island City,
Astoria, East Village, and Harlem. Where in many places the program can
be used to incentivize investment where it would not otherwise exist, it
is simply being used as another giveaway to wealthy investors. Investors
are set to benefit on their federal taxes for years to come. However,
since much of New York's tax code is linked to the federal tax code, the
law would currently allow for huge state tax benefits as well. In order
to prevent another giveaway to the wealthy, New York must de-link this
section of federal law from our tax code.

 
LEGISLATIVE HISTORY:

2020: Died in Budget and Revenue/Died in Ways and Means (Assembly)
2019: Advanced to third reading

 
FISCAL IMPLICATIONS:

The bill will prevent a loss in tax revenue to the state.

 
LOCAL FISCAL IMPLICATIONS:

 
EFFECTIVE DATE:
Immediately and shall apply to taxable years beginning on and after
January 1, 2021.

S1195 (ACTIVE) - Bill Text download pdf

 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   1195
 
                        2021-2022 Regular Sessions
 
                             I N  S E N A T E
 
                              January 8, 2021
                                ___________
 
 Introduced  by Sens. GIANARIS, BAILEY, HOYLMAN, JACKSON, KRUEGER, MYRIE,
   RAMOS, RIVERA, SALAZAR -- read twice and  ordered  printed,  and  when
   printed to be committed to the Committee on Budget and Revenue
 
 AN  ACT  to amend the tax law and the administrative code of the city of
   New York, in relation to investment income

   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1.  This act shall be known and may be cited as the "opportu-
 nity zone tax break elimination act".
   § 2. Paragraph (a) of subdivision 6 of section 208 of the tax law,  as
 amended  by  section  5  of part T of chapter 59 of the laws of 2015, is
 amended to read as follows:
   (a) (i) The term "investment income" means income,  including  capital
 gains  in  excess  of  capital  losses,  from investment capital, to the
 extent included in  computing  entire  net  income,  less,  (A)  in  the
 discretion  of  the  commissioner,  any interest deductions allowable in
 computing entire net income which are directly or  indirectly  attribut-
 able  to  investment capital or investment income, (B) ANY CAPITAL GAINS
 DEFERRED OR EXCLUDED UNDER 26 U.S.C. §1400-Z-2, provided, however,  that
 in no case shall investment income exceed entire net income. (ii) If the
 amount  of interest deductions subtracted under subparagraph (i) of this
 paragraph exceeds investment income, the  excess  of  such  amount  over
 investment  income must be added back to entire net income. (iii) If the
 taxpayer's investment income determined without regard to  the  interest
 deductions subtracted under subparagraph (i) of this paragraph comprises
 more  than eight percent of the taxpayer's entire net income, investment
 income determined without regard  to  such  interest  deductions  cannot
 exceed eight percent of the taxpayer's entire net income.
   §  3. Paragraph (a) of subdivision 5 of section 11-652 of the adminis-
 trative code of the city of New York, as added by section 1 of part D of
 chapter 60 of the laws of 2015, is amended to read as follows:
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.

                                                            LBD03332-01-1

 S. 1195                             2
 
   (a) (i) The term "investment income" means income,  including  capital
 gains  in  excess  of  capital  losses,  from investment capital, to the
 extent included in  computing  entire  net  income,  less,  (A)  in  the
 discretion  of  the  commissioner  of  finance,  any interest deductions
 allowable in computing entire net income which are directly or indirect-
 ly  attributable  to  investment  capital  or investment income, (B) ANY
 CAPITAL GAINS DEFERRED OR EXCLUDED UNDER 26 U.S.C  §1400-Z-2,  provided,
 however,  that  in  no  case  shall  investment income exceed entire net
 income.
   (ii) If the amount of interest deductions  subtracted  under  subpara-
 graph  (i)  of  this  paragraph exceeds investment income, the excess of
 such amount over investment income must be  added  back  to  entire  net
 income.
   (iii) If the taxpayer's investment income determined without regard to
 the  interest deductions subtracted under subparagraph (i) of this para-
 graph comprises more than eight percent of  the  taxpayer's  entire  net
 income,  investment  income  determined  without regard to such interest
 deductions cannot exceed eight percent  of  the  taxpayer's  entire  net
 income.
   § 4. This act shall take effect immediately and shall apply to taxable
 years beginning on and after January 1, 2021.

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senate Bill S1195

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Archive: Last Bill Status - In Senate Committee Budget And Revenue Committee

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Co-Sponsors

S1195 (ACTIVE) - Details

S1195 (ACTIVE) - Summary

S1195 (ACTIVE) - Sponsor Memo

S1195 (ACTIVE) - Bill Text download pdf

Comments

senate Bill S1195

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Sponsored By

Archive: Last Bill Status - In Senate Committee Budget And Revenue Committee

Your Voice

Actions

Co-Sponsors

S1195 (ACTIVE) - Details

S1195 (ACTIVE) - Summary

S1195 (ACTIVE) - Sponsor Memo

S1195 (ACTIVE) - Bill Text download pdf

Comments